The World Leader in High Performance Signal Processing Solutions
ADI to Acquire Hittite
Microwave Corporation June 9, 2014 2 Forward-Looking Statements This presentation contains forward-looking statements, which address a variety of subjects including, for example, the expected timetable for closing of the transaction between ADI and Hittite Microwave Corporation, the expected benefits and synergies of the transaction, including the effect of the transaction on ADIs non-GAAP earnings, ADIs expected product development and technical advances resulting from the transaction, the availability of debt financing for the transaction and ADIs guidance for its third and fourth quarters of fiscal year 2014. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: the closing of the transaction is subject to the tender of shares by Hittite Microwave Corporation stockholders representing at least a majority of the outstanding fully-diluted shares; the receipt of regulatory approvals, and other closing conditions, the non-satisfaction of which may delay or prevent the closing of the transaction; higher than expected or unexpected costs associated with or relating to the transaction; the expected benefits, synergies and growth prospects of the transaction may not be achieved in a timely manner, or at all; Hittite Microwave Corporations business may not be successfully integrated with ADIs following the closing; and disruption from the transaction may adversely affect Hittite Microwave Corporations relationships with its customers, suppliers or employees. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to both ADIs and Hittite Microwave Corporations filings with the Securities and Exchange Commission, including the risk factors contained in each of ADIs and Hittite Microwave Corporations most recent Quarterly Reports on Form 10-Q. Forward-looking statements represent managements current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.
Important Additional Information Will Be Filed with the Securities and Exchange Commission This presentation is neither an offer to purchase nor a solicitation of an offer to sell shares of Hittite Microwave Corporation. At the time the tender offer is commenced, ADI will file with the Securities and Exchange Commission (SEC) and mail to Hittite Microwave Corporations stockholders a Tender Offer Statement and Hittite Microwave Corporation will file with the SEC and mail to its stockholders a Tender Offer Solicitation/Recommendation Statement in connection with the transaction. These documents will contain important information about ADI, Hittite Microwave Corporation, the transaction and other related matters. Investors and security holders are urged to read each of these documents carefully when they are available. Investors and security holders will be able to obtain free copies of the Tender Offer Statement, the Tender Offer Solicitation/Recommendation Statement and other documents filed with the SEC by ADI and Hittite Microwave Corporation through the website maintained by the SEC at www.sec.gov. In addition, investors and security holders will be able to obtain free copies of these documents from ADI or Hittite Microwave Corporation by contacting ADIs Director of Investor Relations at Analog Devices, Inc., One Technology Way, Norwood, Massachusetts 02062; telephone: 781-461-3282 or by contacting Hittite Microwave Corporations Chief Financial Officer at Hittite Microwave Corporation, 2 Elizabeth Drive Chelmsford, Massachusetts 01824; telephone: 978-250-3343. Todays Announcement ADI signs definitive agreement to acquire Hittite Microwave Corporation Offer price for Hittite of $78.00 per share; Enterprise value of approximately $2.0 billion Expected to be accretive on a non-GAAP basis Expected to close near the end of ADIs third fiscal quarter, subject to regulatory clearance and other customary closing conditions
3 ADI Strategy 4 Diversify Across Industrial, Communications & Automotive Lead in Signal Processing Technology Converter Leader High Performance Amplifier Leader Sustain Growth, High Profits & Strong Balance Sheet ADI Acquisition of Hittite 5 Advances Our Technology Position Expands Our Market Opportunity Strengthens ADIs Outstanding Financial Performance Gives ADI the ability to convert the entire frequency spectrum Strengthens ADIs position as a strategic supplier Accelerates growth by expanding market in ADIs core businesses of industrial, comms infrastructure, and automotive Expected to be accretive* to gross margins, operating profits and EPS *On a non-GAAP basis (excluding transaction costs and the amortization of intangibles associated with the transaction) Hittite Overview Decades long focus in high performance RF and microwave technology Extensive product portfolio includes integrated circuits, modules, and subsystem solutions Specializes in technically demanding and mission-critical industrial and communications applications Fabless business model focuses resources on circuit design and applications engineering Headquartered in Massachusetts; approximately 500 employees worldwide 6 ADI + Hittite
7 E L E C T R O M A G N E T I C F R E Q U E N C Y S P E C T R U M Magnetic Resonance Imaging (MRI) Wireless Data, Toll Tags Cellular 2G, 3G, 4G CATV & Cable Modem RFID, Telematics GPS DVB, Satellite Radio WiMAX Wireless LAN Access Points Test Equipment Short Haul SDH / PDH Radio Links Satellite Payload Comms & Telemetry Consumer & Industrial VSAT 24G Advanced Driver Assistance Systems Scientific Imaging & Measurement SATCOM Terminal Eband Pt-to-Pt Systems 77G Advanced Driver Assistance Systems VBand Pt-to-Pt Systems Military Radar & Counter- Measures DBS, Industrial Imaging 5G Comms Radio Wave Microwave Millimeter Wave 0 GHz 6 GHz 20 GHz 110 GHz C O M B I N E D C A P A B I L I T I E S Cellular infrastructure Microwave Broadband Fiber Optic Networks Communications Infrastructure Test and Measurement Aerospace Defense Industrial Advanced Driver Assistance Systems Automotive ADI + Hittite Expands Opportunities within Industrial, Communications, and Automotive Strong technology and expertise
Highly sophisticated solutions earn high profits
Expands addressable market 8 Financial Considerations 9 Terms $78.00 in cash Consideration $2.5 billion equity value $2.0 enterprise value Financing Structure Tender offer to be launched in approximately 10 business days ADI will fund transaction with a combination of cash on hand and short-term debt financing Continued commitment to returning cash to shareholders through dividends and share repurchases Ample available liquidity ADI + Hittite Generating Growth, High Profits & Cash Flow 10 Revenue: Gross profit margin: Operating margin (2) : Cash flow from operations Cash flow as a % of revenue (3) Key LTM Financial Metrics (1) ADI
Hittite
ADI + Hittite
$2,675M 65.3% 30.9% $898M 34% $277M 69.6% 38.1% $84M 30% $2,952M 65.7% 31.6% $982M 33% (1) ADI Last Twelve Months (LTM) ended May 3, 2014 and Hittite LTM ended March 31, 2014 (2) ADI and Hittite operating profits exclude one-time items (3) Calculated as cash flow from operations divided by revenue ADI + Hittite Advances ADIs Strategy Adds significant revenue growth to ADIs industrial and communications businesses Approaching $1B in Amplifier/RF revenue through expansion into higher frequency ranges, especially microwave Strengthens ADIs high performance RF and microwave expertise required to address megatrend of ubiquitous connectivity 11 $M
Revenue by Market Revenue by Product Category $0 $500 $1,000 $1,500 Industrial Comms ADI Hittite $0 $500 $1,000 Amplifiers/RF +39% +11% +25% Fiscal year 2013 Conclusion 12 Expands ADIs Position In High Performance Signal Processing Solutions and drives growth in key markets Strong complementary position in RF and microwave applications Allows ADI to provide more complete and differentiated solutions for our customers Expected to be accretive to margins and EPS on a non-GAAP basis Q&A 13 The World Leader in High Performance Signal Processing Solutions Thank You June 9, 2014 Important Additional Information Will Be Filed with the Securities and Exchange Commission This presentation is neither an offer to purchase nor a solicitation of an offer to sell shares of Hittite Microwave Corporation. At the time the tender offer is commenced, ADI will file with the Securities and Exchange Commission (SEC) and mail to Hittite Microwave Corporations stockholders a Tender Offer Statement and Hittite Microwave Corporation will file with the SEC and mail to its stockholders a Tender Offer Solicitation/Recommendation Statement in connection with the transaction. These documents will contain important information about ADI, Hittite Microwave Corporation, the transaction and other related matters. Investors and security holders are urged to read each of these documents carefully when they are available. Investors and security holders will be able to obtain free copies of the Tender Offer Statement, the Tender Offer Solicitation/Recommendation Statement and other documents filed with the SEC by ADI and Hittite Microwave Corporation through the website maintained by the SEC at www.sec.gov. In addition, investors and security holders will be able to obtain free copies of these documents from ADI or Hittite Microwave Corporation by contacting ADIs Director of Investor Relations at Analog Devices, Inc., One Technology Way, Norwood, Massachusetts 02062; telephone: 781-461-3282 or by contacting Hittite Microwave Corporations Chief Financial Officer at Hittite Microwave Corporation, 2 Elizabeth Drive Chelmsford, Massachusetts 01824; telephone: 978-250-3343.
Across - The - Curve - in - Rates - and - Structured - Products - and - Across - The - Grade - in - Credit - Products - December 19, 2006 - (Bear, - Stearns - & - Co. - Inc.) PDF